Best term insurance can be bought online. There are many life insurance companies offering the same insurance product but with a difference. So, how do we arrive at the best term insurance plan for us? Thankfully, internet shopping for a term insurance policy is both easy and clear. But before you begin, it is important to know your online resources (of information) to arrive at the best term policy for the benefit of your family.
We tell you how to buy the best term insurance plan amid all online options:
1. Price
Look for the lowest premium amount and highest insurance coverage in return. There is a provision of using a premium calculator online which helps you directly calculate the return on your investment. You don’t have to be a mathematician to do that. Simply put in the amount you are willing to pay and compare the quote offered by select insurance companies. It is easy to compare term life policies online as they are structurally similar and easy to understand. Since it is simple to comprehend, it makes buying term insurance policy price-competitive over cash for value policies.
2. Ease of buying a policy
This is an important aspect of the term insurance plan. Since, term insurance is an essential good, buying one should not be a complicated, time-consuming process.
The information presented by the insurance company should be crisp, clear and objective. In addition, the clauses like a medical check-up requirement to confirm a term insurance plan is usually mentioned clearly as the buyer clicks to buy a term insurance plan. The process is simple to follow since term insurance buyer has fewer information problems as compared to buying a cash-value endowment policy.
3. Premium Comparison
Term insurance premiums can be different among different insurers due to multiple reasons. A most common reason for a few insurers to offer lower premiums for similar benefits are any of the following two:
- The insurer does not have as many offices across the country
- The insurance plan has some additional exclusions
You can compare the premiums, however, simultaneously look at these two aspects as well. You can use online premium calculators provided by the insurers to estimate the premiums.
Compare the different features of variants of term plans offered by different insurance companies. A single-life insurance company will offer you variants of term insurance plans. Do an intra-comparison on the company website and follow it up with term plans offered by other insurance companies.
4. Features of Term Plans
While a pure term plan has one simple feature, it is not sufficient. Death is not the only risk in life that can derail your family’s plans, then why limit your insurance to only this risk.
You can add benefits to the term plan to improve your cover under similarly disastrous situations like – accident, or life-threatening disease or disability.
There are features like terminal or critical illnesses, increasing cover with accidental death benefit and flexibility in premium payment modes. Always look for add-on benefits as a benefit of buying the best term insurance plan online.
5. Solvency Ratio
The solvency ratio is a strong indicator of the company’s financial position. It further clarifies a company’s situation or capacity to settle claims. IRDA directs all life insurance companies to maintain a solvency ratio of 150% to meet long-term liabilities and minimize the bankruptcy risk. Higher solvency ratio ups your chances of your claims getting paid.
6. Claim settlement ratio
It is one of the most crucial steps to authenticate the reputation of a life insurance company. It shows the records of a company in settling the term insurance claims. Every financial year, IRDA (on its website) releases the claim settlement ratio for life insurance companies in India. Claim settlement ratio is the number of claims paid by a life insurance company as against the total claims received by the company in a financial year.
The claim settlement ratio is usually expressed as a percentage. Good life insurance companies may have a claim settlement ratio above 95%.
However, this measure gives you a broader picture of all the plans sold by the insurer. The best term insurance plan will depend more on the additional covers available with the plan.
In the end, buying the best term insurance plan online is really based on a subjective assessment. Your subjectivity on the matter gives you an upper-edge while negotiating the best term insurance deal. Unlike your interaction with an insurance agent, a digital buying experience gives you a perfect hand to know about the insurance product in detail and compare it too. It is a far more confident and smarter choice to make.